Business entities have long recognized that substantial productivity and marketing benefits may potentially arise from conducting commercial business activities and business processes over distributed computer networks. In order for a business to achieve the full benefits of network-based commercial activity, the firm's existing commerce-related or business process software application systems must communicate both among each other and with the application systems of other business entities. Earlier efforts at business-to-business commerce activity, such as those led by Electronic Data Interchange (EDI) applications for example, focussed on high volume transaction processing for large firms. Because of incompatible application file formats and communications protocols, and requirements for expensive application programming changes to existing systems, EDI applications were largely viewed as being commercially practical for only the largest companies and for only a select number of applications. Moreover, because of a lack of any universal data interchange formats, companies were, and still are, often prevented from exploiting their own enterprise systems integration to reach external partner applications. As a result, a business may need to spend substantial time to extract, redefine, and update data to serve specific collaborative needs with partners or customers. In addition, smaller companies with limited information technology development budgets or with old legacy systems may still be struggling with internal business systems integration issues.
In recent years, the Internet distributed computer network has developed the infrastructure and data communications protocols to connect all businesses to each other regardless of their size, geographic location or position in the supply chain. The Internet is a collection of interconnected individual networks operated by government, industry, academia, and private parties that use a set of standard data communications protocols to form a global, distributed network. Networked distributed computer systems may be configured as intranets, extranets or publicly available systems using Internet technologies. Internet technologies provide business entities with another opportunity to achieve substantial productivity gains and marketing benefits by conducting internal, business-to-consumer and business-to-business Internet-based commercial activities among employees, and with customers, vendors, suppliers and other parties related to their business enterprises. Internet-based commercial activities, referred to generally in the current literature as “electronic commerce”, “e-commerce”, or “e-business” include, but are not limited to, all types of business processes that can take place in a secure manner online, as well as the more traditional buying and selling of goods and services. The Internet environment holds out the promise of true collaborative data exchange and software application interoperability for business firms of all sizes.
Several standardization efforts by industry consortia and e-commerce vendors are underway in an effort to achieve Internet application interoperability and seamless transaction processing that will appear transparent to users. One recent standard, Extensible Markup Language (XML), was adopted by the World Wide Web Consortium in February, 1998. In its broadest sense, XML is a system for defining, validating, and sharing document formats on the Web, providing a universal format for structured documents and data. XML is a markup language for presenting documents on the Web that relies on tags and is a meta-language for defining specific subject matter domains of markup tags. XML stores the definitions of tags in files called Document Type Definitions (DTDs). DTDs, also referred to as dictionaries, vocabularies, or schemas, serve as a uniform source of data definitions for specific industries or fields of knowledge, making it easier to exchange data not only within an organization but also among different companies. XML is an extensible standard because users may define their own electronic document type in the form of a DTD. The simple syntax makes an XML document easy to process by machine while the tags promote human understanding of document contents. XML style sheets, called XSL, describe how the tagged data in an XML program should be displayed. Further information about XML and the World Wide Web Consortium, also known as W3C, can be found at the W3C.org Web site.
Several efforts underway to standardize transaction processing use XML. In the financial industry, for example, J.P. Morgan & Co. Inc. and Price Waterhouse Coopers recently proposed an XML dictionary called FpML (Financial products Markup Language), which would standardize XML tags in areas such as fixed income derivatives and foreign currency exchange. BizTalk is an industry initiative started by Microsoft Corporation of Redmond Wash. to establish a community of standards users with the goal of driving the rapid, consistent adoption of XML to enable electronic commerce and application integration. The BizTalk design emphasis is to leverage existing applications, data models, solutions, and application infrastructure, and adapt these for electronic commerce through the use of XML. The group is defining the BizTalk Framework™, a set of guidelines for how to publish schemas in XML and how to use XML messages to easily integrate software programs together in order to build new solutions. Additional information about the BizTalk Framework is available at the biztalk.org website.
The Internet Open Trading Protocol (IOTP) provides an interoperable framework for Internet commerce that is independent of the particular type of payment system used and is optimized for the case where the buyer and the merchant do not have a prior acquaintance. IOTP describes the content, format and sequences of messages that pass among the participants, referred to as Trading Roles, in an electronic trade. IOTP defines five different types of Trading Roles (Consumer, Merchant, Payment Handler, Delivery Handler, and Merchant Customer Care Provider) that are the ways in which organizations can participate in a trade. The IOTP framework is centered on an IOTP Transaction that involves one or more organizations playing a Trading Role, and a set of Trading Exchanges. Each Trading Exchange involves the exchange of data, between Trading Roles, in the form of a set of IOTP Messages. Each IOTP Message is the outermost wrapper for an XML document that is sent between Trading Roles that take part in a trade. An IOTP message is a well-formed XML document that contains several components including a collection of IOTP Trading Blocks (Request, Exchange, Response) that carries the data required to carry out an IOTP Transaction. An IOTP Trading Exchange consists of the exchange, between two Trading Roles, of a sequence of documents consisting of three main parts: the sending of a Request Block by one Trading Role (the initiator) to another Trading Role (the recipient), the optional exchange of one or more Exchange Blocks between the recipient and the initiator, and the sending of a Response Block to the initiator by the Trading Role that received the Request Block. For more information regarding IOTP, the reader is referred to an Internet-Draft document describing Version 1.0 of the IOTP, published by the Internet Engineering Task Force (IETF) and available at the IETF.org web site, as of February, 2000.
The Open Buying on the Internet (OBI, available at the openbuy.org website) standard from the OBI Consortium aims to standardize and secure the corporate purchasing model, especially the high-volume, low-dollar transactions that account for 80% of most organizations' purchasing activities. OBI's goal is to establish a common ground for what is referred to as “The Trading Web,” where OBI standards adopters establish trading relationships with other OBI standards adopters through secured access to extranet facilities connected via the Internet, forming dynamic sets of interoperable systems. OBI defines an architectural approach for e-commerce systems, detailed technical specifications, guidelines for development, record layout formats, file formats, communication structures and protocols, compliance testing guidelines, and implementation assistance. The OBI standard includes precise technical specifications for the security, transport, and contents of OBI Order Requests and OBI Orders. In the currently published standard, contents of OBI Order Requests and OBI Orders are based on the ANSI ASC X.12's 850, a standard for an EDI purchase order. The OBI Consortium may provide support for XML documents in the future. For a complete discussion of the OBI technical specifications, consult version 2.0 of the Open Buying on the Internet standard available at the openbuy.org/obi/specs/obiv2.html website.
RosettaNet is an initiative by a consortium of more than thirty companies in the personal computer (PC) industry, ranging from manufacturers to resellers. Two XML data dictionaries in development will provide a common set of properties required for conducting business among Consortium members. The first is a technical properties dictionary (technical specifications for all product categories), and the second is a business properties dictionary which includes catalog properties, partner properties (i.e., attributes used to describe supply chain partner companies) and business transaction properties. The goal is a common business language that will link the entire PC industry's supply chain. These dictionaries, coupled with the RosettaNet Implementation Framework (RNIF, an exchange protocol), form the basis for an e-commerce dialog known as the Partner Interface Process or PIP. RosettaNet's PIPs are specialized system-to-system XML-based dialogs that define how business processes are conducted between electronic component and information technology products manufacturers, software publishers, distributors, resellers and corporate end users. The purpose of each PIP is to enable the development of interoperable applications by providing common business/data models and documents that enable system developers to implement RosettaNet interfaces. Each PIP includes one or more XML documents based on Implementation Framework DTDs, specifying one or more PIP services, transactions, and messages. For further information the reader is referred to the RNIF document designated as version 1.1 and published Nov. 8, 1999, discussing the RNIF in detail, available at More information about RosettaNet is available at the rosettanet.org website.
Private vendors, such as Ariba Technologies Inc., Commerce One Inc., and Concur Technologies Inc., are using XML to simplify the process of matching up RFPs and purchase orders over the Web. The Ariba Network platform also provides a range of Internet services for buying and selling organizations, including supplier directories, supplier catalog and content management, access to supplier content, and secure transaction routing. The Ariba Network platform is built around a multi-protocol architecture that allows buyers to send transactions from their Ariba buyer-enablement application in one standard format. The Ariba Network platform then automatically converts the order into the suppliers' preferred transaction protocol, eliminating the need for a single standard for electronic commerce and giving suppliers the freedom to transact in their preferred protocol over the Internet. Ariba Network automatically routes and translates transactions between buying organizations and suppliers using many major e-commerce standards, including Internet Electronic Data Interchange (EDI), VAN-based EDI, Open Buying on the Internet (OBI), secure HTML, e-mail, auto-FAX, Catalog Interchange Format (CIF), and a protocol known as Commerce XML (cXML). cXML defines a set of XML DTDs to describe the characteristics of non-production Maintenance, Repair, and Operations (MRO) goods and services. cXML serves as a meta-language to enable the development of “intelligent shopping agents” to assist with the corporate purchasing function. cXML's request/response messaging is used to exchange transaction data between parties. These messages provide support for purchase orders, charge orders, acknowledgements, status updating, shipment notifications, and payment transactions.
The public and proprietary efforts underway to standardize transaction processing in the distributed network environment are largely directed to specific industry, function or subject matter domains, such as PC supply-chain management, financial payment handling, or corporate purchasing. Thus, it appears that the standardization effort is directed to establishing predetermined descriptions of transaction message exchanges or dialogs that are specific to and optimized for a specific subject matter or industry domain. Automated commerce solutions that define interactions in terms of fixed message exchanges forgo the flexibility and adaptability required in today's dynamic marketplaces. There will be a wide range of interactions between any two parties in the marketplace that simply do not lend themselves to easy categorization or definition, and that will change over time as the business needs change and as their relationship changes.
XML and related data representation standardization efforts, combined with industry-based e-commerce standards efforts, clearly expand the reach of Internet-based e-business to a wider range of enterprises and are efforts in the direction of an integrated Internet e-commerce environment. But these efforts alone fall short of the complete integration needed. What is needed is a transaction processing architecture that directly supports users' needs in the marketplace and a uniform, consistent and flexible transaction definition capability that supports a full range of transaction processing in a distributed network environment.